Income Inequality and Education

Senators Lamar Alexander (R, TN) and Tim Scott (R, SC) are proposing legislation that would address income inequality (while acknowledging that income inequality by itself is not, of necessity, bad) by addressing a critical aspect of opportunity equality (or inequality): education.

While I disagree with the details of the plans, the two Senators most assuredly are on the right track.

Alexander’s proposed bill, the Scholarships for Kids Act, would transfer Federal dollars to States, and each State then would determine how parents could apply the funding.  Scott’s proposed bill, the CHOICE Act, would use Federal transfers to States to facilitate each State’s ability to supplement existing scholarship programs for “military families, those with children facing physical challenges, and students in impoverished areas.”

Why Does America Have Poor People?

I’ll start with an old parable.  One man makes $1,000/day, and another makes $10/day.  The “high income” man then opens a factory and hires the “low income” man, and two or three others, at $100/day.  The high income man, with his factory, now makes $2,000/day.  The income disparity difference certainly has increased, markedly, from the original $990/day to $1,900/day.

But has the disparity increased, really?  The high income man, from his factory and hirings has gone from making 100 times the low income man’s earnings to only 20 times that man’s earnings.  And while the high income man’s earnings have doubled, the low income man’s earnings have gone up 10 times.

The American Welfare State

James Pethokoukis, of AEIdeas, an affiliate of the American Enterprise Institute, has an article that shows the economic devastation extant in the policies of the Federal government.  It’s important to note that, much as I dislike the present administration, these results also flow from the “efforts” of a long string of administrations.

I don’t have much to add, so here is the complete article, reprinted with the kind permission of AEI.

6 charts that show the Welfare State run amok